What Are My Rights In a Breach of Contract Case?

Nov 17, 2017

What Are My Rights In a Breach of Contract Case?

Posted By
Fitzpatrick Mariano Santos Sousa P.C.

A business contract contains specific obligations that must be fulfilled by the parties entering into the agreement. When one party fails to uphold their contractual obligations, it is known as a "breach" of the contract. A breach of contract can happen when one party fails to perform their duties on time, does not perform their duties in accordance with the terms of the agreement, or does not perform their duties at all. Contract breaches are usually categorized as either "material" or "immaterial." This classification determines the appropriate legal solution for the breach.

When a breach of contract happens, one or both of the parties can have the contract enforced on its terms, or they can try to recover financial damages caused by the alleged breach. If a contract dispute cannot be resolved, the next step is likely a lawsuit. If the amount in question is below a certain dollar figure, the parties might be able to resolve their dispute in small claims court.

Legal remedies for a breach of contract include:

Damages: Can be compensatory, punitive, nominal, or liquidated damages.

Specific Performance: This is a court-ordered performance of duty for the breaching party. Specific performance can be used if the subject matter of the agreement is rare or unique, and damages would not be enough to place the non-breaching party in a good position.

Cancellation & Restitution: The non-breaching party can cancel the contract and sue for restitution if they have given a benefit to the breaching party. "Restitution" means that the non-breaching party is put back in the position it was in before the contract breach occurred. "Cancellation" of the contract voids the contract and eliminates any obligation under the agreement for all parties.